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Corruption/ Bribery Issues - Coggle Diagram
Corruption/ Bribery Issues
Corruption
"the abuse of power for private gain"
Monopoly power (M) + Discretion (D) - Accountability (A) = Corruption (C)
Grease/ Speed Money
Payment for doing something he or she should do faster
Foreign Corrupt Practice Act (US) and OECD allows grease payments but not Singapore.
It would mistake to conclude that grease payments and other forms of petty corruption are totally harmless.
As the example Singapore shows, attacking both grand and petty corruption plays huge dividend toward total business confidence in the fairness of the regulatory and legal system, leading to increased investment as well as improving living conditions of citizens.
Bribery
"the offering, giving, receiving, or requesting of something of value for the purpose of influencing the action of an official in the discharge of his or her duties"
Multinational companies are forbidden to pay bribes both by local laws of the counties in which they operate and by laws in their "home" jurisdiction
Payments usually involve creative practices such as using agents or dealers to make payments, tapping unaccounted pools of cash, or slush funds, sponsoring foreign travel, providing extravagant gifts or entertainment, and making charitable contributions to nongovernmental organisations recommended by government officials and politicians
Overtime, a company that is uncompromising in its ethics develops a reputation that serves as the best shield against bribe
Corruption/ Bribery Cases
Nissan CEO Saikawa resigns after internal investigation found that he had received excess pay after altering the terms of bonus. For a mere $440,000, he ruined his reputation.
Two men were charged in court for accepting bribes to exercise leniency over their supervision at the Chevron plant done by engineering firm. The bribe amount to over $25,000.
Ways to prevent corruption or bribery issues
Gifts & Entertainment
Have a legitimate business purpose
Be proportionate
Be transparent (declared in the company's Gift and Hospitality policy)
Dealing with Foreign Officials
When it comes to dealing with foreign officials, make it clear that employees must not offer cash or anything of value to a foreign public official or anyone closely related to them, including charities or voluntary organisations run by their spouses.
Red Flags
Performing no service other than facilitating
Abnormally high fees or commission
An insistence on urgency/ commission
An insistence on meeting without company representatives being present
Requesting advance or cash payment
Requesting payment via third parties
Operating in a country or territory with perceived high corruption
Report concerns immediately
Be aware of who to report to and how if you have witnessed or suspect bribery